New Florida Medical Cannabis Licenses Prioritize Black Farmers

In a request process that state health officials will soon launch, a black farmer with ties to doing business in Florida will be at the forehead of a long-awaited batch of medical cannabis licenses, senior officials of Gov. Ron DeSantis (R) said.

The aides told the Florida News Service that, within weeks-to-months, the health department will launch the rulemaking process for black farmers. They will also lay the groundwork for another set of licenses that would approximately double the number of clinical cannabis operators in the state.

Black Ocala nursery operator Howard Gunn said in a phone interview that it would be “awesome” to get a medical cannabis license, something he stated is “definitely overdue.”

State health officials are ready to commence the application procedure after a highly anticipated decision from the Florida Supreme Court last month upholding a law of 2017 implementing a constitutional amendment for 2016 to legalize medical cannabis. The court upheld the law’s requirement that medical cannabis operators deal with all aspects of the business, including culture, processing, and distribution—instead concentrating on each element. Florigrown LLC, based in Tampa, challenged the law, had until 11 June to request rehearsing but did not.

Part of Florida’s 2017 law requires health officials to issue licenses to one applicant in the decades-old “Pigford” cases, which addressed federal racial discrimination against black farmers.

There are currently 22 licensed operators in Florida, known as “medical marijuana treatment centers” (MMTC) which have over 200 retail outlets throughout the country.

But the number of licensed operators is dramatically behind part of the 2017 legislation that requires additional licenses because the number of qualified patients, almost 600,000 now, is rising. The Act requires that Health Department officials add 15 MMTCs to 22 existing operators. When patients reach the 600,000 mark in the following months, the number of new licenses will increase to 19.

State officials will concentrate on granting a single license to a black farmer who complies with specific provisions, including being a litigant in the Pigford cases. Many black farmers who made claims in the federal class-action proceeding have died. The majority of surviving litigants are now in their 80s and 90s.

Pigford applicants will attempt to enter an established market for medical cannabis, where licenses sell for up to $50 million. In 2015, licensed were granted to operators wanting to sell low-THC cannabis. They were later able to sell full-strength cannabis after state voters approved the 2016 constitutional amendment.

“How do you fight that type of situation? Where do we go from there?” said Gunn. “There’s no way that we’re going to be able to keep up with that. And it is not going to change. They get further and further ahead. Now that we’re playing catch up, we’re just going to have to be more strategic.”

The impending rulemaking process for the black farmer application will likely be the template for granting an increased amount of licenses. It will, almost certainly, lead to legal and administrative challenges as investors from all over the world vie for position in Florida’s “green rush” for the first time in six years.

The law does not require the applicant for Pigford to reside in Florida during his participation in the class action proceedings. However, other parts of the law require that applicants be “registered in the State for businesses” for “five consecutive years” before applying.

DeSantis aides said black farmers’ applicants must satisfy all other law requirements, including registered business in Florida for at least five years, to be eligible for a license.

How the government’s interpretation of the law will affect commercial partnerships between Pigford class members and investors looking for a footprint in Florida is not exactly clear.

DeSantis senior staffers said medical cannabis players are very “creative.”

They believe that all applicants, not just Pigford, will find ways to bring additional major players—funders or master producers. One senior officer, who spoke on condition that she was not identified, said that they’ll “see various strategies” used to build a multidisciplinary team to compile a complete application.

The interpretation of the law reduces the number of litigants eligible for a license in Pigford.

The DeSantis administration plan might also be pushed out by investors who have partnered with black farmers from other countries in the hope of issuing a license. In addition, insiders in the medical cannabis industry are divided on the approach of the Department of Health.

“The legislative intent is clear,” said Jim McKee, an attorney representing medical cannabis operators and new applicants. “That you need an applicant that was a class member of the Pigford litigation that otherwise is an owner of a five-year company…in order to file an application for that license,”

Some industry insiders say the Pigford applicant requirements and the 2017 Act itself are too restrictive and could severely limit the number of applicants.

Meanwhile, government health officials intend to use emergency regulation authorities to issue the proposed black farmer regulations to speed up the process. While the rule of the black farmer application can be completed before the end of the year, the period to grant a license is highly challenging.

A DeSantis aide stated that they cannot control the challenges, and the current long-standing market will almost double when they license the applications.

“So that’s an element of challengers that we just have to consider are out there who may not be excited about 19 new licensees,” said the aide. “And then you have everyone who doesn’t win, and we can expect those people to probably challenge those awards as well. So, we are prepared to move as quickly as we can in the best way possible, but we’re not naive to the fact that we might get a lot of challenges that slow us down,”

Senate Agriculture Chairman Darryl Rouson (D), who led a move to grant a license to a black farmer, said he intends to follow up on how health authorities deal with applications and permits from black farmers when legislative committees begin meeting again later this year.

Rouson stated that he is delighted that the applications are going to be awarded and opened up yet disappointed they will start behind other licensees who have operated for five to six-years already.

“As the chair of Agriculture,” said Rouson. “I intend to make one of my priorities in the incoming session the plight of the Black farmer and I intend to have discussions with leadership about us taking the lead in making sure this gets done.”

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